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What China?

The current alarm expressed by foreign policy experts with President Elect Donald Trump’s recent telephone discussion with Republic of China President Tsai Ing-wen, stirred old memories about the U.S.’s sensitive “One China” policy.

During the 1980 presidential campaign, I was tasked with the assignment to convey to Governor Ronald Reagan, then the presumptive Republican nominee, the U.S. cotton industry’s concerns about his criticism of the Peoples Republic of China, which was and remains a significant market for U.S. raw cotton.

The attached story, "That’s Something I Wasn’t Aware Of," (which appears here in part) was published in "Moments of Truth," my 2014 memoir of short stories, details my discussion with soon-to-be President Ronald Reagan about U.S. commercial activity with each nation.

My principals in the U.S. cotton industry were concerned Governor Ronald Reagan’s statements pertaining to The Peoples Republic of China. At this juncture in the campaign, Reagan was the presumptive nominee when the Reagan bandwagon rolled into Washington for meetings and receptions. Through Nancy Chotiner, a Republican National Committee official, a meeting was scheduled on April 9th, following a reception for Governor Reagan at the Madison Hotel.

Soon after Reagan spoke, Nancy Chotiner took me up to Reagan’s suite, where Reagan and his Campaign Chair, William Casey, were waiting. I had met the governor briefly in 1976 when he was on Capitol Hill and again in Washington at a 1977 reception.

I went over my talking points in silence as I rode up on the elevator with Nancy. Knowing that Reagan was always relaxed and cordial, I, too, was relaxed, and that’s how it played out.

Nancy introduced me to Governor Reagan and Bill Casey. I had talked briefly to Reagan as he made the rounds at the reception downstairs. “Neal is a wonderful name. Did you know that’s my brother’s name?”

“No, sir, I didn’t.”

“Now tell me, how can I be of help?”

I smiled, “Governor, I represent the U.S. cotton merchants. We export U.S. cotton to many countries around the world. A good portion of what has been exported in the last few years is grown in California.”

“Cotton in California – I knew we grew some. Do we grow that much?

“It’s the highest-valued crop produced in California, Governor.”

Reagan turned and looked at Casey. “You know that’s something I wasn’t aware of. I thought our biggest crops were grapes and vegetables.”

“They might be larger in volume produced, but the aggregate value of the California cotton crop exceeds that of the other crops.”

He paused. “That’s interesting. I guess it’s something I should have been aware of, but I left those details to my agriculture commissioner.”

“Governor, what I wanted to stress with you is that the most reliable customer for U.S. cotton is the People’s Republic of China (PRC).”

His eyes widened. “You mean Red China?”

“Yes, sir, our concern is that you have recently made statements critical of what you call ‘Red China.’ That has caused problems with our customers there.”

Reagan smiled. “Well, we’re involved in an election. President Carter has withdrawn the U.S. recognition of the Republic of China (Taiwan) without even sending a postcard to notify the Chinese government in Taipei. They saw it on the news. They lost their seat in the UN. I don’t know if I can rectify that or reverse that if I’m elected, but I intend to speak out about it.”

He was firm in his statement but still friendly, so I continued the discussion. “I happen to agree with you in that regard. That was thoughtless and gratuitous on Carter’s part.”

“Do we sell any cotton to Taiwan?”

“Yes, we do. It has been a good market over the years, but not a reliable market – not as reliable as the Chinese.”

“In what regard?”

“Well, Governor, when the price goes up, the U.S. suppliers are expected to deliver the cotton at the lower price agreed to in the forward contract, and they do. In recent years, however, when the situation was reversed and the price went down after cotton had been sold at a higher price, the Taiwanese textile mills have defaulted on their contracts. That’s not the case in China, where we sell directly to a government entity – it always honor its contracts.”

Reagan put his hand to his chin and smiled. It was the moment of truth. “So what you’re telling me is that Red China is more reliable than Jimmy Carter.”

We all laughed, and I thanked him for his time. “I’ll remember what you told me today,” he said as I left his suite.

I rushed from the Madison Hotel to my office three blocks away and placed a conference call to my executive committee and reported on the discussion.

Reagan rolled on in the 22 remaining primaries, losing to Bush only in the District of Columbia, where he was not on the ballot, and in Pennsylvania and Michigan. On May 26th, Bush withdrew from the race. In July, Reagan selected Bush as his running mate, and in November they beat Carter by an overwhelmingly majority carrying 45 states, an amazing victory when you consider that in the February ABC News-Harris Survey, Carter had polled 64 percent to Reagan’s 32 percent.

George Bush had served as the chief of the liaison office to the PRC, in effect the U.S. ambassador, under President Gerald R. Ford in 1974-1975, the period in which U.S. cotton exporters incurred problems in the Far East with the exception of the PRC. Bush was aware of the importance of the PRC as a market for U.S. cotton. Later in the campaign, when I met with Bush, I reported on my conversation with Reagan. Bush smiled. “Don’t worry, he’ll be President soon. He’ll say the right thing.”
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